Report says southern England holds billions of barrels of oil

This area is set to be explored for shale gas in Fernhurst, West Sussex, United Kingdom.

Photo: Matthew Lloyd

Shale rock underneath some of the wealthiest counties in southern England may contain billions of barrels of oil, a government report says.

The Weald basin, covering counties south of London including Surrey, Sussex and Kent, may have as much as 8.6 billion barrels, according to a report published last week by the British Geological Survey.

It didn't say how much could be extracted profitably. The U.K.'s extractable oil reserves are 3.1 billion barrels, data by BP show.

The report is likely to add to the controversy about drilling for shale oil and natural gas in the U.K. The government wants to develop the resources to boost the economy.

Opponents say the process of hydraulic fracturing, using high volumes of water, sand and chemicals to drill shale, can damage the environment.

Last year, the survey said the Bowland basin, which extends across east and northwest England, may hold as much as 1,300 trillion cubic feet of gas. That's enough to meet demand for almost half a century with extraction rates similar to U.S. fields, according to Bloomberg calculations.

Tax breaks have been offered to drillers to stimulate the shale industry amid rising fuel imports and declining reserves in the North Sea, which has yielded 42 billion barrels since the 1970s.

The likely range of shale oil in the Weald is 2.2 billion to 8.6 billion, the report said, adding that shale gas potential in the basin is limited.

In the latest move to spur the industry, the government said last week it plans to "simplify" access to property for the shale and geothermal industries.

"The new proposals would simplify procedures which are costly, time-consuming, and disproportionate for new methods of underground drilling," the Department of Energy and Climate Change said. "Oil, gas and deep geothermal companies will be able to explore their potential, and will in return provide a voluntary community payment for access."

Foes criticized the plans, saying they could damage the prospects of the Conservative Party.

"Stripping away people's property rights while trying to kick off a Klondike-style shale oil rush in the Home Counties is a highly toxic policy mix," Greenpeace said.